Sounds like a simple scare tactic to scare up some possible cancellations in order to resell the rooms at a much higher rate. Probably well known in the GM circles. Little downside for the property other than being reported to Corporate as the smarter one's have done. I would also bet if you did nothing the property wouldn't cancel & resell knowing the penalties and costs when you show up.

Also believe most non FT'ers gladly comply to alleviate the stress of not having a room when they show up after a major effort to get there.

Definitely an underhanded scare tactic IMO.